Ford posts $2.3B profit for Q2, $424M operating loss

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Ford Motor Company is continuing to reverse its fortunes despite the globe's bleak auto markets, as the Dearborn, MI based-automaker surprised analysts with a $2.3 billion profit in the second quarter. Ford isn't dancing in the streets just yet, though, as it is still reporting $424 million in overall operating losses for the quarter. The $2.3 billion profit comes courtesy debt reduction activities taken on during the quarter, as Ford reduced its debt load by $10 billion as part of a debt-for-equity exchange, and a further $1.5 billion was raised in a stock sale. Ford says the $10 billion equity swap alone saved the company $500 million in interest expenses.

While the Blue Oval has a long way to go to get to where it wants to be, comparing numbers from the same quarter last year shows how far the automaker has come. Ford posted an $8.7 billion loss in Q2 2008, while posting a $1.4 billion operations loss.

Analysts were expecting an improvement for 2009, but the target was a 53 cent per share loss, and Ford shattered that with a loss of only 21 cents per share. Importantly, Ford has dramatically improved its cash situation too, as the company burned through only $300 million in cash. That's a huge improvement when compared to the $3.7 billion greenbacks Ford scorched in Q1. Mullaly and Co. now has $21 billion in cash on hand, down from $21.3 billion after Q1.

Ford also had good news on the production front, as its market share increased in a historically bad market. Ford increased share the right way, too, as it managed to do so despite decreasing incentive spend by $250 per vehicle compared to Q1. Ford CEO Alan Mulally sounds pretty optimistic about the company's prospects, with Q2 numbers bolstering its position. Check out the complete press release after the jump.

[Source: Ford Motor Company]Continue reading Ford posts $2.3B profit for Q2, $424M operating loss
Ford posts $2.3B profit for Q2, $424M operating loss originally appeared on Autoblog on Thu, 23 Jul 2009 09:58:00 EST. Please see our terms for use of feeds.


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